THE Chinese military will conduct a joint rescue exercise with the Australian Defence Force in earthquake-prone Sichuan.

The move comes only a week after Beijing reacted angrily to the announcement the US would rotate marines through Darwin.

The exercise comes as China began extensive naval manoeuvres in the South China Sea.

There is growing concern in the region at China's military build-up and modernisation, including the development of its first stealth fighters and aircraft carriers.

Western and Asian nations have issued calls for more transparency on the multi-trillion-dollar program.

The Weekend Australian has learned Australian officials in Beijing briefed both the Foreign Ministry and the People's Liberation Army a day ahead of US President Barack Obama's announcement that the Australian government had agreed to have 2500 US marines stationed in Darwin.

Reaction was understood to be muted but one diplomat said: "China can take some time to digest things."

But despite the announcement by Mr Obama on his trip to Australia last week, there has been increased contact and co-operation between the Australian and Chinese armed forces in recent years, including a live-ammunition exercise off the Chinese coast last year, which caused inter-departmental ructions in Canberra.

Fifteen Australian army personnel, including a four-person medical team, will travel to China for the exercise next week, code named Co-operation Spirit 11 (CS11).

It will be held at a Chinese army rescue base about an hour outside the city of Chengdu, in the region where the devastating Wenchuan earthquake occurred in 2008, claiming 90,000 lives.

The project is a bilateral Humanitarian Assistance and Disaster Relief planning exercise between the Australian Defence Force and the People's Liberation Army.

The exercise is based on an earthquake disaster response scenario in a fictitious third country, the Defence Department said.

"This exercise is an element of the defence international engagement with China and aims to enhance mutual understanding of respective approaches to a multinational HADR response in a third country," the department said.